GRAINCORP expects the forecast eastern Australian crop of 20.6 million tonnes of grain to stretch its bulk handling network this season, especially with the prospect of a condensed harvest due to delayed crop development.
Mark Palmquist, GrainCorp chief executive, said the company was expecting to retain its market share of 42pc of the east coast crop to be delivered into its storages with a markedly larger crop expected, up 3.3mt year on year.
“The expectation is that it won’t be an orderly harvest and that there will be local storage deficits at times.”
“Our concern is that we will be harvesting at many areas at the same time and that will stop efficient utilisation of infrastructure.”
“That is right across the board, from road freight and harvesters to our stacking equipment at our sites.
“It is going to be strained right across the network with this much grain to come off.”
NSW Farmers grains committee chair Rebecca Reardon said early signs were that grain transport infrastructure was likely to come under pressure from farmers looking to move big volumes of grain.
Ms Reardon, who farms near Moree, said farmers in her area were reporting excellent yields with their first crop to come off.
“There are plenty of people with 5 tonne to the hectare up to 5.5t/ha crops, which is huge,” she said.
“It can be quite difficult to source extra trucks to move the grain.”
Ms Reardon said modern high capacity harvesters were ripping off massive amounts of grain.
“You have headers pulling off 50t an hour, with a couple going you can take off 1000t in a day, that requires a lot of trucks to keep it away.”
She said locally there were already issues emerging with slow turnaround times.
“We are hearing of two or three hour turnaround times, especially at the sites with the higher daily prices.”
General manager of operations at GrainCorp Nigel Lotz said the tonnes were starting to come off in earnest now as the harvest heats up in NSW.
“Last week was a cracker, we took over 1.3mt of grain with sites like Walgett and Coonamble really kicking in,” Mr Lotz said.
“It goes to show what can happen when you get some good weather and the harvesters really begin to roll.”
Mr Lotz said the company was expecting north-west NSW to be markedly better than last year.
“They have had a run of poor years but I think they will be pleased this year, you could expect 600,000 tonnes out of Coonamble and Walgett alone.”
Mr Lotz said GrainCorp’s Project Regeneration capital expenditure program across its freight network would help it cope with the forecast big yields.
“We’ve had some good investments in equipment at our primary sites, particularly in terms of outloading the grain quickly.
“We can load a train of 2400 tonnes in just three hours at sites now, it is a big bonus in keeping grain moving through the system.”
“We don’t have to break trains, everyone is happier with more grain moving on rail.”
Out of the infrastructure upgrades, Mr Lotz said some was to permanent equipment and was investment in transportable machinery.
“It will be a challenge shuffling the portable equipment around with so many sites up and running at once, it might mean some sites have older equipment at the start or the finish of harvest, but we will do our best.”
Ms Reardon said a further complication could be the need for alternative segregations due to quality issues.
“The quality in this area is generally pretty good, but there are some problems with black tip so if that gets worse we might see the need for lower quality segregations to be opened up.”
Ms Reardon’s comments about yield back up the opinions of some analysts who think the 20.6mt figure being quoted by GrainCorp is on the low side.
Mr Palmquist said there was a chance total production could rise from previous estimates, but said it was too early to accurately predict that.
“We are seeing a good volume of chickpeas hitting the system in Queensland but that is not a good reflection of where the cereal crop will be at.”
“Cereals are starting to hit the system but it is still too early in the harvest to get a true reflection of the crop profile in terms of yield and quality.”
Mr Lotz said there had been some black tipping in cereal crops and concerns about botrytis grey mould in chickpeas, but said the chickpeas were coming in better than expected.
In terms of GrainCorp’s market share, farmers have indicated they will store grain on-farm hoping for a lift in grain prices, but there are no more grain bags or silos available for purchase which may see farmers forced to deliver into the bulk system to retain crop quality.
There will also be changes in terms of the company’s share of the export market.
“Chickpeas are a big growth sector this year and we are typically aligned with a good market share of this crop out of our facilities at Mackay, Gladstone and Fisherman Island in Brisbane,” Mr Palmquist said.
However, off-setting that is increased competition such as that from the Quattro facility in Port Kembla.
“We haven’t faced that competition on a full year basis yet.”